Kidney Foundation Malawi ‘captured’  by ‘corrupt’ dialysis clinic operator Fresenius Medical Care

A dialysis clinic operator Fresenius Medical Care  which is embroiled in allegations that the company paid bribes to in several countries  to win or retain business including  Malawi’s Ministry of Health which offered it a K262 million three-year contract to supply dialysis services to Kamuzu Central Hospital (KCH) in Lilongwe has been implicated in another scandal of bribing patients and guardians of people suffering from kidney failure to root for its procurement services.

On Wednesday,  December 30 2020, Kidney Association of Malawi converged a group of journalists at the KCH where its  leadership made a number of appeals to sway Ministry of Health to pick Fresenius Medical Care as the operator of Dialysis Clinic at the medical facility.

The Kidney Foundation chairperson Frank Mwale demanded government to give the contract of operating Dialysis clinic at KCH to Fresenius and  spoke negatively against services provided by Nipro Japan through their agent Worldwide Pharmaceutical (WWP).

“Fresenius machines are more user friendly than Nipro,” said Mwale as he kept on canvassing that  Fresenius should be given the contract.

Mwale’s conduct is in sharp breach of procurement law as government cannot just wake up  and start dishing out contracts like ‘Father Christmas’ without following procedures.

At Queen Elizabeth Central Hospital in Blantyre, Fresenius has also had its three-year contract renewed without following procedures.

Mwale failed to give plausible answer when pressed by reporters that at one time Fresenius abruptly discontinued to provide dialysis services to chronic patients in Blantyre risking their lives over payment and they did not convene a press conference then.

He was also  asked to give his honest opinion  that Ministry of Health has been discriminatory in providing comprehensive dialysis services as the same government provided a dialysis at QECH using Fresenius with complete back of maintenance services for equipment but never did the same for KCH.  As a result  KCH had a water treatment plant broken down as well as dialysis machines that were getting poor quality from the plant. But Mwale was evasive on such discriminatory arrangements.

Said Mwale:”Fresenius machines are more user friendly than Nipro.”

Fresenius was supposed to hand over the machines to Malawi government after the first five-year contract as its properties but following the extension no price adjustments were made while Fresenius continued making money on the same machines. Asked to comment on that, Mwale just kept on saying  “no matter what, Fresenius  should get the contract at KCH.”

He said despite Fresenius not having an agent in Malawi like the Nipro Japan,  their “back support is very effective.”

Pressed to comment on whether he was  satisfied with the level of honesty, transparency and due diligence in the contracts with Fresenius,  Mwale again was evasive.

“Much as we appreciate the role played by Nipro/WPP, but we want now the service of Fresenius South Africa to be extended to KCH,”  he said.

Foundation presser  – apparently bankrolled by  Fresenius – comes hot of  heals of  Human Rights Defenders Coalition (HRDC)  request to the Anti-Corruption Bureau (ACB) to  investigate company for gratification of officials in Malawi to win contracts.

HRDC letter to ACB  follows allegations that the US  Department of Justice ordered it, in March 2019, to pay a fine of $231 million for violation of provisions of the Foreign Corrupt Practices Act.

Trapence said it  is high time that institutions such as Public Procurement and Disposal of Assets Authority (PPDA) before contracting,  they should have have due deligence to some of the companies that come to Malawi  such as Fresenius Medical Care  which  admitted that it doled out bribes to officials in 13 countries including Angola, Morocco,  Benin, Burkina Faso, Ivory Coast, Gabon,  Cameroon, Senegal, Saudi Arabia and also failed to maintain proper internal accounting control.

“Malawians want value for their money,” he said.

On December 15, Ministry of Health  officials wrote the PPDA requesting for a ‘no objection’ to award a three-year single-source contract to Fresenius Medical Care at the cost of K262 million.

In the same letter, the ministry also requested for a three-year extension of the company’s contract with Queen Elizabeth Central Hospital (Qech) in Blantyre at the cost of K200 million [R3, 644,942.88] without openly tendering.

PPDA has since rejected the KCH contract proposal on the basis that the tender for the contract should have been open-source but approved the ministry’s request to extend the Qech contract by three more years.

In a letter to the Ministry of Health, dated December 18 2020, PPDA argues—in rejecting the request to expand Fresenius Medical Care’s dialysis service to KCH—that the approach the ministry took did not satisfy any of the conditions for use of the single-source method of procurement, as provided for under Section 37 (9) of the PPD Act.

“The procurement of additional dialysis equipment and supply and delivery of dialysis consumables and related accessories should, therefore, be realised through open means in order for the government of Malawi to realise value for money in the procurement.

“You are kindly advised to conduct fresh procurement proceedings for the supply and delivery of dialysis equipment and services-level agreement for the supply and delivery of consumables and accessories for Kamuzu Central Hospital,” the PPDA letter to the Ministry of Health, which Patrick Nkunika signed, reads.

It is alleged that Fresenius has doled out  bribes to officials in the Ministry of Health to get the dialysis deal extension despite even complaints of bad service they offered.

In Morocco, for instance, the department said the company paid bribes through a “sham” commission to a Moroccan state official in order to win contracts to develop dialysis centers at state-owned military hospitals.

The scheme worked by having the commission pay 10 percent of the value of the contract to the official, and the payment would be disguised as a bonus payment to a Fresenius company employee.

In addition to Morocco, Angola and Saudi Arabia, the company also paid bribes in Spain, the Justice Department said.

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